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email bruce.bohannon@biggreenegg.com. He has always returned my emails within hours.
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bobroo said:Boys, boys, boys here is what happened with the Costco thing. No large vendor or distributer went out of business and sold it's assets to Costco (there are heavily worded contracts that BGE gets to reclaim the assets if that ever occurs).Costco has a little over 600 hundred locations. Let's say they forecasted selling 10 medium eggs per location = 6,000 MBGE's for the starting inventory and had option to purchase more. The suggested retail price of a MBGE is about $750. Costco, being who they are and having lots of cash negotiated their price BELOW what your corner dealer pays, I bet they paid about $400 per MBGE....perhaps even less.Costco doesn't provide expertise for the merchandise they sell. Often they don't sell complimentary goods or accessories. Point being: they bought below the cost of your neighborhood dealer, flooded the market with a bunch of items that require a large learning curve, and take no responsibility if something goes wrong.Let's do the rough math. Costco made ( 6,000 X $750 = 4.5 mil) minus (6,000 X $400= 2.4 mil) = 2.3 million dollars. What did BGE make??? I bet the cost to manufacture a medium is about $100. So ( 6,000 X $400 = 2.4 mil) minus ( 6,000 x $100 = $600,000) = 1.8 million dollars.Who won? Costco and BGE. Who lost? You and your local dealer.Warranty claim??? Explain to me why any manufacturer wants to give out free product with shipping. To make an egg user happy??? Dude, they're not worried if you're happy; they are worried about striking next deal with a large retailer for 6,000 units.
HI Bobroo-Just out of curiosity, how do you know this? I'm not being sarcastic, I'm truly interested.
Jeff
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Vitaman said:bobroo said:Boys, boys, boys here is what happened with the Costco thing. No large vendor or distributer went out of business and sold it's assets to Costco (there are heavily worded contracts that BGE gets to reclaim the assets if that ever occurs).Costco has a little over 600 hundred locations. Let's say they forecasted selling 10 medium eggs per location = 6,000 MBGE's for the starting inventory and had option to purchase more. The suggested retail price of a MBGE is about $750. Costco, being who they are and having lots of cash negotiated their price BELOW what your corner dealer pays, I bet they paid about $400 per MBGE....perhaps even less.Costco doesn't provide expertise for the merchandise they sell. Often they don't sell complimentary goods or accessories. Point being: they bought below the cost of your neighborhood dealer, flooded the market with a bunch of items that require a large learning curve, and take no responsibility if something goes wrong.Let's do the rough math. Costco made ( 6,000 X $750 = 4.5 mil) minus (6,000 X $400= 2.4 mil) = 2.3 million dollars. What did BGE make??? I bet the cost to manufacture a medium is about $100. So ( 6,000 X $400 = 2.4 mil) minus ( 6,000 x $100 = $600,000) = 1.8 million dollars.Who won? Costco and BGE. Who lost? You and your local dealer.Warranty claim??? Explain to me why any manufacturer wants to give out free product with shipping. To make an egg user happy??? Dude, they're not worried if you're happy; they are worried about striking next deal with a large retailer for 6,000 units.
HI Bobroo-Just out of curiosity, how do you know this? I'm not being sarcastic, I'm truly interested.
Jeff
He made up the numbers but the rest is spot on. The only part that I disagree is about who lost. The only loser in this deal is the authorized dealer and not the customers.
It was a great deal for egg buyers but not for me as they didn't sell XLs. -
Vitaman said:bobroo said:Boys, boys, boys here is what happened with the Costco thing. No large vendor or distributer went out of business and sold it's assets to Costco (there are heavily worded contracts that BGE gets to reclaim the assets if that ever occurs).Costco has a little over 600 hundred locations. Let's say they forecasted selling 10 medium eggs per location = 6,000 MBGE's for the starting inventory and had option to purchase more. The suggested retail price of a MBGE is about $750. Costco, being who they are and having lots of cash negotiated their price BELOW what your corner dealer pays, I bet they paid about $400 per MBGE....perhaps even less.Costco doesn't provide expertise for the merchandise they sell. Often they don't sell complimentary goods or accessories. Point being: they bought below the cost of your neighborhood dealer, flooded the market with a bunch of items that require a large learning curve, and take no responsibility if something goes wrong.Let's do the rough math. Costco made ( 6,000 X $750 = 4.5 mil) minus (6,000 X $400= 2.4 mil) = 2.3 million dollars. What did BGE make??? I bet the cost to manufacture a medium is about $100. So ( 6,000 X $400 = 2.4 mil) minus ( 6,000 x $100 = $600,000) = 1.8 million dollars.Who won? Costco and BGE. Who lost? You and your local dealer.Warranty claim??? Explain to me why any manufacturer wants to give out free product with shipping. To make an egg user happy??? Dude, they're not worried if you're happy; they are worried about striking next deal with a large retailer for 6,000 units.
HI Bobroo-Just out of curiosity, how do you know this? I'm not being sarcastic, I'm truly interested.
Jeff
Keepin' It Weird in The ATX FBTX -
If they were that focused about cutting the next deal with the next giant retailer then why don't they just get on with it?. They've only been in business for 34 years so I guess they need more time to figure out that big retailers = big sales?Be careful, man! I've got a beverage here.
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If they are anything like most companies in America, Here is the way it most likely went down:BGE, along with many other consumer brands were flying in a red hot economy. Building inventories to keep up with year after year of record sales. Taking out loans to build that inventory. The economy crashes and suddenly these companies have 20,000 widgets that need to be moved. They run some promotions......economy still sucks and people are not paying $1000 for something they don't need. Distributors stop ordering and even cancel orders because their warehouses are full. They try everything they can to move them but end of year is looming and they are facing serious financial repercussions if these aren't moved. The bank is freaking out because they are on the hook for your 20,000 widgets and and every other company they loaned money to for inventory as well. You look across the table and the only answer is to go outside your normal chain of distribution and dump units. Companies like Costco were there to relive the pressure and help BGE to get their inventory in line.It happens, I've lived it (more than once) and sometimes it's 100% necessary. There is no conspiracy. They were in a tough spot and need to move goods. Simple as thatKeepin' It Weird in The ATX FBTX
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travisstrick said:If they were that focused about cutting the next deal with the next giant retailer then why don't they just get on with it?. They've only been in business for 34 years so I guess they need more time to figure out that big retailers = big sales?Keepin' It Weird in The ATX FBTX
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You still in Denver dude? Friday night with a beer bus and you are on the forum? Just sayin'
Steve
Caledon, ON
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Little Steven said:You still in Denver dude? Friday night with a beer bus and you are on the forum? Just sayin'Keepin' It Weird in The ATX FBTX
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Little Steven said:I'll split it with you.Keepin' It Weird in The ATX FBTX
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Little Steven said:But I don't drink whiskyKeepin' It Weird in The ATX FBTX
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"Well, I don't normally do that."
"Fine, then kiss me"
"But I shouldn't"
"Just do it"Be careful, man! I've got a beverage here. -
chirp.......chirp.......chirp.....is that crickets??????Keepin' It Weird in The ATX FBTX
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my new favourite thread! i'm going to "star" it..BGE emailed me back this afternoon and are sending me a replacement and threw in a pdf about how I can never use my plate setter legs down again.Whiskey!Guiness!Cab Sav!Large BGE and Medium BGE
36" Blackstone - Greensboro!
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